Every generation endures moments that define its character — the “Greatest Generation” launched the largest and deadliest war in human history and established a global order that we follow today; Generation X suffered the shock of 9/11, which resulted in our draconian national security. Today, we are watching another generation-defining event unfold before our eyes — the COVID-19 pandemic’s effect on the young, impressionable Generation Z.
The question that follows is how Gen Z will emerge when the crisis finally ends. How will they fare economically? Socially? Politically? How will their perspectives change?
Before the outbreak of COVID-19, Gen Z’s economic future was optimistic — prospective workers were ready to ride the wave of low unemployment rates and America’s longest period of economic expansion ever. Studies show that Gen Z was projected to be a more pragmatic generation, worried about “building wealth and seeking stability,” possibly because of the loans that many of their Gen X parents are still paying off.
Now, much of Gen Z is either poised to enter or recently joined a job market that is literally telling people not to work. Much of the generation is expected to survive in an economy that is likely in a recession that will be more intense than the Great Recession and could last longer if the pandemic continues to rage on. What will be the generational consequences of this sudden economic uncertainty?
Interestingly enough, the life experiences of Millennials serve as a helpful model in understanding the ways this virus will shape Gen Z economically, both in terms of consumer decision-making and personal wealth. For Millennials, the Great Recession played a major role in creating their worldview — Millennials learned to be more practical financially and risk-averse with their decision-making because they watched the crisis unfold and stepped into the abysmal job market that followed. In fact, a report shows that Millennials are the most fiscally conservative generation since the Great Depression.
Similarly, the economic downturn from COVID-19 is disproportionately hurting Gen Z workers, and it is striking at a time when the generation is still incredibly malleable. This timing, coupled with economic hardship, creates a strong possibility that the cohort will follow its Millennial predecessor by becoming significantly more fiscally conservative and less wealthy than earlier generations. Some posit that Millennials are already becoming a “lost generation” — one that is deprived of financial power and, consequently, a certain degree of influence over the world. If this pandemic continues to strangle the economy, Gen Z might unfortunately find themselves in the same situation. The economic resemblance is furthered by the fact that Gen Z will likely take on the same crippling student loan debt that changed Millennials as consumers.
To say that one economic downturn will have the same impact as another would be fundamentalist — the Great Recession crept into our lives after the pop of the housing bubble while this one slapped us in the face. However, the rapid nature of this downturn could very well create an even bigger impression on this generation’s decision-making.
COVID-19 has the potential to change not only the decision-making of Gen Z but also its perspective on the economy in its entirety. Socialism, at least the common American interpretation of the word that Bernie Sanders has popularized, might emerge from this crisis above capitalism as the preferred economic system for much of Gen Z.
Responses to the virus so far have largely exemplified watered-down socialism, or at least progressive ideals. The stimulus package checks are similar to universal basic income, which is far from socialism but in the right direction (or left, rather). Sanders argues that this pandemic is exposing the lack of quality healthcare and corporate insurance profiteering and insists that Medicare for All is the solution. President Trump even supported the possibility of the government taking equity stakes in certain companies, to which Colorado Governor Jared Polis (D) responded by calling him “socialist.” By witnessing contemporary capitalism resort to socialist tendencies to stop the recession for the sake of the public good, younger people might be more receptive of socialism as a whole. Likewise, Millennials gravitated toward socialism after seeing the fragility of the economy in the 2008 financial crisis.
Last year, a poll showed that Gen Z already viewed socialism more positively than every other generation besides Millennials, almost as positively as they view capitalism, so there is already momentum to build on. Although, it is important to note that younger generations are typically more left, politically speaking, than older ones.
Many compare this pandemic to the Spanish flu outbreak that occurred just over a century ago. While the natures of the two viruses are quite different, many of the anxiety-induced tendencies of the public are the same, such as food stockpiling, social-distancing, and wearing surgical masks.
The general skepticism toward interpersonal interactions, circulation of conspiracy theories, and lack of trust in public institutions have created an atmosphere of suspicion comparable to the outbreak in 1918. One paper argues that this suspicion remained even after the pandemic concluded and led to a long-term decline in social trust that ultimately constrained economic growth. If the Trump administration exacerbates the current conditions of the pandemic, possibly by opening the economy too early, then the mistrust among all generations could be more intense and linger longer.
The entire world is waiting for the revival of our old way of life and for COVID-19 to slither out of existence. The problem is that this pandemic will never quite leave us, especially Gen Z — its residue will remain in our psyche, our relationships, and our world in more ways than we will ever understand.